Assoc.Prof. Thongnard KumchaiChiangmai University,Thailand

Trade in Health Services in ASEAN

Contents

•Global trends in international trade in the health services sector

•Trade in Health Services in ASEAN

•Summary

Industrialproducts

Services

Agricultureproducts

WTO

World Trade Organization: goods and services

1. Goods(Multilateral Agreements on Trade in Goods-MTAs)

2. Services (General Agreement on Trade in Services-GATS)

3. Intellectual Property(Agreement on Trade Related Intellectual Property Rights-TRIPS)

WTOWTO

Agricultural and food products

Trade in ServicesTrade in Services

• Service is increasingly becoming an important sector in each economy

• Main instrument is the General Agreement on Trade in Services (GATS)

GATSGATS

• Obligations• Most Favoured National Treatment

• Market Access• National treatment

• Transparency• Domestic Regulation

• Liberalization commitments

Share of services in GDP vs. income

10

20

30

40

50

60

70

80

90

4 5 6 7 8 9 10 11

ln(GDP per capita)

Perc

enta

ge s

hare

of s

ervi

ces

in G

DP

CambodiaVietnam Indonesia

Thailand Malaysia

Singapore

Philippines

Increase in share of service sector

BusinessCommunications

ConstructionLogistics

EducationEnvironment

FinancialHealth services

TourismRecreation, culture and sports

TransportationOther services

Service sectors

Health Services sub-sectors

Specialized Services

Dental Care

Medical Check-Up

Health Promotion

Thai Spa

Traditional Thai Massage

Long Stay

Food, Drugs and Herbal Products

Food

Drug

Cosmetics

Progress in WTO round of negotiation

WTO time out

“Time out to review the situation, time out to examine available options and time out to review

positions,”

‘Today there are only losers.’

Pascal Lamy

WTO Director General

Latest situation in WTO

Global Situations and Trends

Delay in WTO

negotiation

Global trends in

international trade

More countries engage

inFTA

FTA

FTA logo

?Regional

Bilateral

Multilateral

Which way?

Multilateral, Regional, and Bilateral

THINK ASEAN

• AEC•600 millions of people

ASEAN Economic CommunityASEAN Economic Community

Free flow of Services, Investments, Goods, and Capital

ASEAN Vision 2020ASEAN Vision 2020

ASEAN Community 2015ASEAN Community 2015

• To speed up efforts to create a single market by 2015,five years ahead schedule.

ASEAN Community 2015ASEAN Community 2015

ASEAN SecurityCommunity (ASC)

ASEAN EconomicCommunity (AEC)

ASEAN Socio-CulturalCommunity (ASCC)

The Peaceful, prosperous, and people-centric ASEAN

Regional production base Single regional market

• To enhance cooperation in services and eliminate substantially restrictions

• To liberalize trade in services beyond those undertaken under GATS (i.e.GATS plus)

• AFAS adopts the structure and approach of GATS/WTO

• The negotiation is conducted through the Coordinating Committee on Services-CCS

ASEAN Framework Agreement on Services-AFASASEAN Framework Agreement on Services-AFAS

ASEAN priority sectors

Goods and manufacturing Services

ElectronicsWood-based productsAutomotivesRubber-based productsTextiles and apparelsAgro-based productsFisheries

Infocomm technology (ICT) e-ASEANHealthcareAir travelTourism Logistics

GATS CommitmentsGATS Commitments

• Trade in services is distinguished into four different modes :

• Mode 1 Cross – border Supply• Mode 2 Consumption Abroad• Mode 3 Commercial Presence

• Mode 4 Presence of Natural Persons

Cross – border supplyCross – border supply

• Telemedicine• Tele – education and consultation

e-Health

General citizen

Cross – border supplyCross – border supply

1. Question of ethical and legal aspects2. Question of professional licensing

3. Question of “gatekeeper”

Consumption abroadConsumption abroad

• Potential area• Health care services

…. Good quality health personnel

…. Hi – tech medical equipment

• Dental care• Cosmetic surgery

• Tour + health package• Short stay + health package

• Health insurance

Commercial PresenceCommercial Presence

Country A invest in hospital service in country B

or

Country B invest in hospital service in country A

CCS Trade Agreements

Priority Services Sectors

2006 Foreign equity ≥ 49 %

2010 Foreign equity ≥ 70 %

Other Services Sector

2015 : Foreign equity ≥ 70%

Presence of natural personsPresence of natural persons

• MRA on Nursing Services 2006

• MRA on Medical Practitioners 2009

• MRA on Dental Practitioners 2009

ASEAN MRA on Dental Practitioners

•Objectives

• 1. facilitate mobility of dental practitioners within ASEAN;

• 2.exchange information and enhance cooperation in respect of MRA

• 3.promote adoption of best practices on standards and qualifications; and

• 4.provide opportunities for capicity building and training of dental practitioners

•

SummarySummary

Trade in Health servicesWTO/RTA/FTA

Trade in Health servicesWTO/RTA/FTA

•Health care sector is a priority sector in trade agreement.•Globalization is a key driver of change in the healthcare system.•The internet will revolutionize the future of medicine•Open economies and free market obviously have impact to healthcare delivery system.

THINK ASEAN